Founder of World Class Holdings/Great Value Storage Ordered to Jail for Contempt of Court

Nate Paul, founder of World Class Holdings and the Great Value Storage brand, was ordered on Friday to serve a 10-day sentence for criminal contempt of court. He’ll be housed at the Travis County Jail, according to sources.

The ruling stems from a civil case in which the self-storage operator is accused of defrauding a nonprofit. State District Judge Jan Soifer issued the contempt last year after Paul “continually refused” to comply with a court order. The sentencing had been delayed as he sought an appeal. However, U.S. District Judge David Allan Ezra upheld it last week and ordered that Paul go into custody on Nov. 15, the source reported.

The nonprofit Mitte Foundation filed a civil lawsuit against Paul in 2018 over investments in his real estate ventures. During arbitration, in which Mitte prevailed, Soifer found Paul guilty of perjury. Paul also violated an injunction requiring him to report transfers of more than $25,000 and obtain fair value for them. He denies that he defrauded the charity, a source reported.

The civil case is separate from an eight-count indictment on federal financial crimes issued in 2023 against Paul, who’s offices and home were raided in 2019. Federal authorities claim Paul made false statements to financial institutions in Connecticut, New York, Texas and Ireland. They say he underreported his total liabilities and overreported his cash. As such, the lies influenced decisions by mortgage lenders to provide the real estate developer with funds to purchase commercial properties, the sources reported.

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Paul also faces a four-count indictment related to wire fraud. The trial is expected to begin next year, a source reported.

The World Class 64-property self-storage portfolio sold in 2022 for $588 million to global real estate investment firm CBRE Group Inc. and William Warren Group, a privately held real estate company that operates the StorQuest Self Storage brand. At the time, the portfolio comprised more than 4.1 million rentable square feet in Colorado, Illinois, Indiana, Mississippi, Missouri, Nevada, New York, Ohio, Tennessee and Texas. The sale didn’t include the company’s properties in California or those under development.

World Class was once a multi-billion-dollar holding firm that owned a diverse portfolio of assets and operating companies including subsidiaries World Class Property Co. and World Class Capital Group LLC. It had interests in industrial, multi-family, office, retail, self-storage and other sectors.

Sources:
Austin-American Statesman, Austin Developer Nate Paul Was Ordered to Serve 10 Days in Jail
Austin Developer, Ken Paxton Associate Nate Paul Charged With 8 Federal Financial Crimes
KXAN, Jailed: Real Estate Investor Nate Paul Begins 10-Day Sentence

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